Tuesday 1 July 2014 18.17 EDT
First published on Tuesday 1 July 2014 18.17 EDT

Deep recession and sluggish recovery have meant average UK household incomes are no higher than they were in 2001-02, the government has said.

Figures from the Department for Work and Pensions showed that another year of stagnating inflation-adjusted earnings had prolonged the UK's lost decade of squeezed incomes.

The DWP said median real terms household income growth before housing costs remained unchanged at £440 a week in 2012-13 after two years of falls. After housing costs, median incomes fell for a third consecutive year, from £377 a week to £374 a week.

The Institute for Fiscal Studies said there had been a 6% drop in median incomes when adjusted for inflation since the peak, with a 9% fall in mean incomes. The former is calculated by taking the household in the middle of the income distribution, while the latter by dividing total household income by the number of households.

"The large post-recession falls in incomes followed a period of slow income growth that began in the early 2000s, far pre-dating the recession"," the IFS said. "The net result is that the official measure shows both measures of average income no higher in 2012–13 than in 2001–02."